Amid the market retrace, Ethereum (ETH) has lost its key $2,600 support zone and fallen below the next crucial level. As the second-largest cryptocurrency by market capitalization attempts to hold its current range, some analysts predict a 6% drop could be coming.
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Ethereum Risks Fall To $2,180
Following the $1.5 billion hack of crypto exchange Bybit, the crypto industry experienced a market correction that sent most cryptocurrencies below their key support levels. Bitcoin’s price fell below the $90,000 mark for the first time since November.
Meanwhile, Solana, one of the leading Altcoins of the cycle, dropped 30% in five days, hitting a five-month low. Nonetheless, Ethereum’s price held relatively well compared to most cryptocurrencies despite accounting for $1.2 billion of the assets stolen in the hack.
The “King of Altcoins” initially dropped 10%, staying around its pre-Bybit hack levels over the weekend, but failed to sustain the $2,600 support after the market crash resumed on Monday.
Crypto analyst Ali Martinez had previously warned that this level was key for cryptocurrency’s bullish trend continuation, and failing to hold this support zone would send the price to the $2,4000 mark.
After the drop, the analyst stated that the $2,425 level was Ethereum’s next most critical support zone, as 10.33 million wallets accumulated 63.43 million ETH. However, the cryptocurrency failed to hold this level on Wednesday, dropping to $2,300 in the past 24 hours.
Martinez warned that Ethereum needs to hold the $2,345 support level now, where 2 million investors bought 58.88 million ETH. If it falls below this level, the millions of investors will be in the red numbers.
Analyst Carl Runefelt also cautioned about ETH’s current levels, suggesting that Ethereum risked dropping another 6%. The analyst advised investors to monitor the bearish flag forming in Ethereum’s hourly chart for the past day, as it could send ETH’s price near the $2,000 support line.
If the cryptocurrency fails to hold the $2,320-$2,330 level, Ethereum’s price targets a breakdown to $2,180.
Short-Term Rally Or Sideways Move Coming?
Crypto analyst Ted Pillows highlighted ETH’s bullish divergence in the 3-hour chart, suggesting that “a short-term rally towards $2,600-$2,700 looks possible.” However, he noted that the potential rebound could be a “dead at bounce.”
Meanwhile, Altcoin Sherpa indicated that the cryptocurrency could move sideways for the next few months, pointing to ETH’s performance after losing the $2,900 support in August 2024.
Ethereum moved within the $2,100-$2,800 price range from August to November 2024, with the second-largest crypto’s current price action starting to resemble last summer’s performance.
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Another market watcher also suggested that the King of Altcoins needs an extended re-accumulation period to attempt to reclaim the higher levels, as seen during the FTX collapse, 2023’s capitulation, and Summer 2024’s capitulation. Based on this, ETH could move within its current range for the next two to three months.
Lastly, analyst Titan of Crypto pointed out a Wyckoff Check accumulation pattern in ETH’s weekly chart. He stated that Ethereum appears to retest its key level after a breakout to confirm the trend continuation. Per the post, if the $2,140 level holds, there’s a “potential spring and rally continuation.”
As of this writing, Ethereum trades at $2,324, a 15% drop in the weekly timeframe.
Featured Image from Unsplash.com, Chart from TradingView.com
